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Abu Dhabi, the capital of the UAE, is one of the most exciting places to start a business. Setting up a business in Abu Dhabi can open doors to a world of opportunities, thanks to its strategic location, robust infrastructure, and business-friendly environment.
The city is known for its diverse and growing industries. While Abu Dhabi has traditionally been a global leader in oil and gas, it’s now making waves in other sectors like renewable energy, technology, tourism, and finance. In fact, for the first three quarters of 2024, Abu Dhabi’s GDP grew by 3.9%, with non-oil activities contributing to a 5.9% increase.
With so much to offer, Abu Dhabi is truly a city of possibilities. If you’re too considering company formation in Abu Dhabi, let’s explore how you can make it happen.
Company formation in Abu Dhabi offers several significant benefits for businesses:
In certain sectors and free zones, businesses can enjoy 100% foreign ownership. This provides full control over your operations, a significant advantage for international entrepreneurs who may be concerned about local ownership requirements in other parts of the world.
Abu Dhabi offers tax advantages that make it an appealing destination for businesses. There is no personal income tax, and most businesses in free zones benefit from zero corporate tax for up to 50 years.
Abu Dhabi is an excellent gateway to the larger Gulf Cooperation Council (GCC) region and the broader Middle Eastern market. For UK investors, this means easy access to a market of over 50 million people within the GCC alone.
Abu Dhabi offers a highly transparent and efficient regulatory environment for foreign investors. The legal framework is clear, with easy procedures for setting up a business.
Abu Dhabi’s economy is growing rapidly, with non-oil sectors like technology, finance, and tourism contributing significantly. For the first three quarters of 2024, the city’s GDP grew by 3.9%, with non-oil activities increasing by 5.9%.
Abu Dhabi is home to some of the most prominent financial institutions in the region, including the Abu Dhabi Investment Authority (ADIA) and other global banks. UK investors can take advantage of sophisticated banking and financial services, with the ability to open multi-currency accounts, obtain business loans, and access venture capital funding for new ventures.
When setting up a business in Abu Dhabi, you have three main options: Mainland Companies, Free Zone Companies, and Offshore Companies. Each has its own benefits depending on your business needs.
A Mainland company is registered with the Department of Economic Development (DED) in Abu Dhabi, allowing you to operate within the local market without restrictions.
A Free Zone company is established in special economic zones offering benefits like 100% foreign ownership and tax exemptions.
Offshore companies are registered outside the UAE but have a presence in Abu Dhabi. They are typically used for asset protection and international business.
There are several legal structures available for businesses in Abu Dhabi, each offering different advantages based on the type of business, ownership requirements, and operational goals.
A sole proprietorship is a business owned and operated by a single individual. The owner has full control and responsibility for the business.
A Limited Liability Company (LLC) is one of the most common structures in Abu Dhabi. It requires at least one local partner (UAE national) who holds 51% of the shares, with foreign investors holding up to 49%.
A Joint Venture is a partnership between two or more businesses or individuals to work on a specific project or business venture.
A branch office is a subsidiary of a foreign company. It can operate under the parent company’s name but must adhere to UAE laws and regulations.
A free zone company is established within one of Abu Dhabi’s free zones, such as Masdar City or ADGM. It offers several advantages like full foreign ownership, tax exemptions, and simplified company formation.
A representative office is a branch of a foreign company that can only carry out marketing and promotional activities. It cannot conduct direct sales or engage in commercial transactions.
To set up a company in Abu Dhabi, you’ll need to provide several key documents for registration:
Company formation in Abu Dhabi involves a clear process, from selecting the right legal structure to obtaining necessary approvals. Here’s a step-by-step process:
The first step is to decide what type of business you want to set up and the activities you plan to engage in. Ensure your business activity aligns with local regulations.
Choose a unique and appropriate name for your company. The name should comply with local naming conventions (e.g., no offensive words or religious references). Submit the trade name for approval to the Department of Economic Development (DED) to reserve it officially.
Depending on the type of company (Mainland, Free Zone, or Offshore), apply for the appropriate business license with the relevant authority (e.g., DED, Free Zone Authority). Business licenses could be commercial, professional, industrial, or tourism related. Offshore
Most businesses in Abu Dhabi require a physical office to operate. For mainland businesses, this is a must. For free zone businesses, some zones offer virtual offices or flexi-desk options.
After finalizing the office space, submit all required documents, including the lease agreement, to the relevant authority. Pay the fees associated with the business license and any registration fees. These will vary depending on your business activity and legal structure.
Some businesses require additional approvals from regulatory bodies or authorities specific to their industry (e.g., health, education, finance).
Once your business is registered, open a corporate bank account with a bank in the UAE. Some legal structures, like LLCs, may require a minimum capital deposit in the bank before receiving your license.
Once your business is set up, apply for UAE residency visas for the owners, employees, or partners. The number of visas you can apply for depends on the size of your office space and the business setup.
The cost of an Abu Dhabi business license can range from AED 10,000 to AED 28,000 or more, depending on the business activity and location. However, the overall company formation cost in Abu Dhabi varies depending on several factors, such as business activity, legal structure, location (mainland or free zone), and the number of visas required.
It’s essential to evaluate your business needs and seek professional advice from Shuraa Business Setup to get an accurate estimate of the setup costs.
Abu Dhabi offers great opportunities for entrepreneurs and investors with its growing economy and business-friendly environment. Whether you’re looking to start a business on the mainland, in a free zone, or offshore, there are plenty of options to suit your needs.
Taking the first step toward setting up your business in this exciting city is easier than you think. At Shuraa, we have over 23 years of experience in helping businesses get started. Our team makes the entire process simple, from choosing the right setup to getting your licenses and visas. Let Shuraa help you make your business dream a reality in Abu Dhabi.
Shuraa Business Setup is a leading provider of company formation services in the UAE.
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